By Alex Smith / @alexsmith1982
David Cameron has said this weekend that he intends to run the country as if it were Tesco. It reminds me of an entry in yarning old favourite stocking-filler Is It Me Or Is Everything Sh*t?, about whether Tesco can be seen as a state wthin a state:
The case for this proposition:
1. Tesco employs over twice as many people as the army - 237,000 to 110,000.
2. Not content with already pocketing £1 of every £8 spent in UK shops, Tesco is expanding its tentacles into every area of our lives - including insurance, online DVD rental and banking.
3. Tesco's colours are red, white and blue.
The case against:
1. It's a supermarket.
You decide."
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Labour has done for the last 12 years, but their store has been out of stock in the idea and management departments for a long time.
It's no wonder customers have gone to Morrisons, Aldi and so on.
cameron uses the tesco simile here so the comparison is quickly recognisable. fair enough. cameron means that one needs to run the country like a successful business - for instance tesco. this simile clearly indicates that cameron believes government should operate within its means and seek to ensure that total costs (the public sector overhead) are lower than revenue raised (tax) while delivering a satisfactory product (government and public services) to the consumer (we, the taxpayer). that is a - dare i say it, so debased has the word become in the hands of gordon brown - prudent philosophy for the management of the public purse. very, very hard to achieve with oft-inadequate political hands; but as an objective, it is quite correct and should be branded on the forehead of every chancellor as a reminder of what the job really entails.
he could equally have cited microsoft or oracle. or bp or shell. but you probably hate them too don't you ... i don't wish to sound sarcastic but you do make it so hard. has anyone here actually worked in the private sector? do any of you understand how government is funded?
The answer, therefore, is for governments (of all political colours) to do as little as possible and leave as much as possible to the private sector.
There would not be much call for Diversity Officers, Climate Change Managers, and Five-a-Day Co-ordinators... and the Guardian's revenue from public sector non-job ads would plummet.... [sigh].
On the surface they look good and are doing well, whereas under the surface (in my opinion) they are only as good as they seem because of their suppliers.
My dealings with them have not been good - poor customer service, bully boy tactics with suppliers whilst trying to spin that they are working for the public when in fact they are only interested in themselves...mmm come to think of it...
They have been good up to a point I think however but in the same way that Microsoft have been for software there is a big danger of the power corrupting.
Therein lies the danger with Dave aligning with Tesco - yes they have been good but there is a downside to them as well.
McNulty lies that he lives with his parents so that he can claim SHA........
Pur-nell makes us pay for his groceries and his 9non) cleaning.......
Follet makes us pay for her Soho security guards.........
All together now:
EVERY LITTLE HELPS!
Tesco increases the number of stores, the range of goods and services it offers and its total sales. This is equivalent to "front line" public services.
Tesco is every efficient at delivering those services and, year on year, achieves internal efficiencies which make it more profitable. This is equivalent to cutting the wasteful public service bureaucracy.
By way of simple example, Tesco's HQ is at Cheshunt. They do not waste much money on it. Compare the new Ministry of Justice which managed to spend £130 million on doing up its new home. It cost £915 per square foot, about 18 times what a standard refurbishment would cost in the private sector. See, for example: http://www.telegraph.co.uk/news/newstopics/politics/lawandorder/3741400/130-million-refurbishment-bill-for-Jack-Straws-new-offices.html
The private sector is always seeking to deliver (sell) more while controlling/cutting overheads. That is the point.
Two more examples from the public sector:
(1) The Department of Health managed to agree a new contract with GPs which resulted in GPs getting a massive pay increase, far more than the Department expected. Did heads roll? Was any outside consultant sued? Would Tesco had got this wrong?
(2) Defra so mismanaged the new EU farming subsidy regime that we got fined several hundred million pounds by Brussels. Did heads roll? (Answer, Margaret Beckett got promoted to Foreign Secretary!) Was any outside consultant sued? Would Tesco have got this wrong?
Controlling, even cutting, government spending need not involve reducing the level of front line services. It can even allow you to increase them. Tesco would manage that. So should our government.
They managed to get hold of the car park that had always been free and was used by the school, a couple of offices and people using the sports centre and library and decided that it was now for their customers only.
They also have an elaborate system of offshore holding companies that has allowed them to avoid tens of millions in taxes.
They may be competent, but I wouldn't want to live in a country run by them.
g g g g g grab your c c c c calculator Osborne.....
ie firstly, create a National Equity invested in productive assets in public ownership, and secondly, list national assets on the balance sheet as well as the major part of the National Debt which relates to them.
As both Willem Buiter and Nicholas Taleb - both well respected commentators - have been pointing out, there is no debt-based solution to our current problems.
The only solution is a new approach to "Equity".
What a choice New Labour or Etonian Tory: Dumb and Dumber
Best public, televised, justification of socialist policies I can remember from the last decade came from Plaid's then leader, Daffydd Wigley. (possibly too many 'f's there)
Compare this with successive governments - particularly the last 12 years - who get almost everything wrong, provide horrendous services, will not listen to the electorate and yet we go on having to pour more and more money into their desperate schemes. And what happens when they finally are forced out of office - they are made EU commisioners or Lords or given quangos to run.
I can see the attraction of the Tesco approach to government - but do not expect to see it happen! Too many vested interests in maintaining the vastly un-democratic status quo.
Longer waiting times (nothing 'express' going on here!);
Higher prices, thanks to a VAT rise to 20%;
Fewer staff (more unemployment), thanks to a 'do nothing' economic plan;
Reduced staff wages (as the minimum wage dwindles after being frozen).
On the plus side, buy one hip replacement and you'll get the other one half price!
In terms of waiting times; the Tories have promised to ringfence NHS funding, Labour haven't.
Higher prices? It is Labour's intention to put VAT to 20% before the next election.
Fewer staff? Labour has put unemployment back to where it was before it took office in '97.
Reduced wages? Nice to see Labour supporters want us to all be minimum wage drones. So much for aspiration.
Applying this to other services like schools is not exactly a hard step - yes, schools would be out to make profit. And how exactly would they find themselves able to actually make a profit? By offering a higher quality product at a lower price than their competitors. Sounds like a damn good idea to me...
Here's a good article called "What if supermarkets were run like schools" - read it, it's very informative. http://www.schoolchoices.org/roo/harris1.htm
Shareholders are - to use the usual rhetoric - "unproductive". It is "inefficient" to pay returns to rentier shareholders when you don't need to. Indeed that is the Cooperative Advantage.
So why not a co-operative of users of education services in partnership with another co-operative of those who provide those services?
That's pretty much what Keith Joseph - the founder of privatisation himself - suggested. He knew that schools were and are a privatisation too far.
It's quite straightforward to create a market solution without profit: there is no profit and no loss within a partnerhip.
It delivering market leading services and yet year on year gets more efficient reducing its overhead by making the right investments.
It operates on low margins (most supermarkets operate at around 5%).
It caters for all pockets from those seeking low prices to those looking for higher quality at good value for money.
It sees a market opportunity and it moves quickly to maximise the value it can obtain by it.
The public knows what it can get for its money, it can see the prices of goods and compare them against the competition. The public can exercise its choice in a fair and transparent manner to maximise their spending.
If you ask, if the country was ran like Tesco's; we would all benefit.
Also, if you turn it on its head.
Could you run private enterprise like the State runs the public sector?
Perhaps not.
Tescos are good at shopping - full stop.
Is Tesco a nationalised industry?
No, thought not.